In an ongoing organization, such as a large law partnership firm, employees are motivated not only by current rewards but also by the prospect of promotion, and the opportunity to make the rules in the future. This leads to a recursive contract design problem in an overlapping generations...

Market based instruments are proving e¤ective in biodiversity procure- ment and in the management of regulatory schemes to preserve biodiversity. The design of these schemes brings together issues in auction design, con- tract theory, ecology, and monitoring. Using a mixed adverse selection,...

We consider a general agency model with coexisting hidden action and hidden information. We prove that, with minor technical qualifications, independence of the production technology from the consumer type is necessary and sufficient for welfare irrelevance of hidden action. Our result clarifies...

We model rent seeking in litigation in weak legal systems as a Tulloch contest in which litigators may seek to influence the court directly through bribery as well as through the merit of the legal case that they bring. If the local firm has a competitive advantage in influencing the court then...

Market failure is pervasive in the environmental sector, and naturally occurring markets are, in many cases, unlikely to produce socially optimal environmental outcomes. Despite this, the case for using “market based instruments” has recently become popular in the Australian environmental...

In an ongoing organization, such as a large law partnership, employees are motivated not only by current rewards but also by the prospect of promotion, and the opportunity to influence policy and make rules in the future. This leads to a dynamic programming problem in contract design. We model...